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6/11/16

The Angry Geologist (TAG) gives us a rundown on one of the classic BS techniques your actual junior will use to make its deposit look more valuable than it is, the Metal Equivalent bait'n'switch. He uses a good example too, the current pumped-to-death Southern Silver (SSV.v), a stock I checked out and passed on (very easily too) but has gone on a newsletter BS-fuelled run in recent weeks.

"Why do they have to (in my opinion) mislead everyone into believing that their project is better than it really is (?)".

...because if you don't know that one, you shouldn't be mucking around with junior mining company stocks in the first place. Dear TAG, please adjust your default setting to "They Are Lying To Me My Job Is To Find Out Where The Lie Is", these are the rules, not the exceptions.

6/10/16

South America photo of the week was taken in Chile, at Santiago airport:

You can just imagine the conversation. Translated, of course:

A: "José?"
B: "Yes boss?"
A: "Can you go to the airport and pick up our visitor, he arrives in one hour."
B: "Sure boss, no problem. What's his name?"
A: "Oh I forget, but it's at the bottom of the mail he sent yesterday."
B: "No problem boss, leave it with me."

Yeah I know it's a massive hit and we don't normally go for those in the Friday OT segment, but nothing is prohibited either. Not only is it great pop with a fun video, but Robin Schulz really knows his music and you can tick off the influences as well as admire his technical ability. It's not catchy as hell for nothing, just listen to the frequency of chord changes that drive the song.

Top song and we oldies should not deny that fact.

UPDATE: Reader AH puts me straight:

Not sure if you know this, but Robin Schulz is not the author of your today's OT track.

LUG has further to drop, too. How much does it need to under perform before Porter Stansberry admits his DD was non-existent and what he's really doing is trying to cozy up to big players by doing them favours with OPM?

Pretium (PVG) is a copmany that burns $5m in about a week and a half, so its recent $5m flow through placement struck this humble corner of cyberspace as weird...what are these people doing raising $5m when they normally go for chunks of 50 large at a time? Anyway, the first tranche closed on June 6th...

"Pretium Resources Inc. (TSX:PVG)(NYSE:PVG) ("Pretivm" or the "Company")
is pleased to announce that it has closed the first tranche of the
previously announced non-brokered private placement offering of 437,000
flow-through common shares ("Flow-Through Shares") of Pretivm at a price
of C$11.45 per share for gross proceeds of approximately C$5 million
(the "Offering"). The first tranche consists of 260,000 Flow-Through
Shares for gross proceeds of approximately C$2.98 million. continues here

...and now the deal is filed we get a little more light shone upon the gig:

Ahhhh, those guys....well, nothing weird or underhand or back-scratching or favour-giving or hush-hush going on there. For sure.

We have a new case of Scumbag versus Scumbag and IKN had a good old laugh last night when A. Reader told him about Daniel Ameduri picking a fight with Agora. The scumbag scam pusher Amerduri's fit of pique is a sight to behold and didn't escape the attention of several readers, who sent over his mailer last night full of spleen about Pershing Gold. Here's an extract from poor little Dannyboy's toy-throwing:

"...the biggest scams out there have what I like to call a “show
horse” at the top. This is the guy with the perfect resume and
background, yet knows nothing about share structure.

The scammers who control the shares give a dog sh*t company a show
horse, and then use him for promotion, when the reality is no one is
going to make any money except for the deep insiders.

Once such company I want our members to avoid is Pershing Gold.
I am shocked that credible newsletters and writers today are suggesting
this stock, and I have to truly question their knowledge of how they
vet these companies. In fact, I almost
have to question if they have some sort of behind-the-scenes deal going
on.

Pershing Gold is
openly tied to the most ruthless Vancouver stock promoter of them all,
whose name I will not mention. But for anyone who is suggesting this
stock, you should be ashamed. It’s one of the reasons on a day like
today, when the GDXJ was
up 5%, Pershing was down… You see these scumbags love to unload their
shares to the public on any strength.

There is no
new case for Pershing Gold when the king of sellers is on the board of directors.

Yes indeed, the kettle calling the pot black as Ameduri, a paid whore who gushes lyrical about worthless crap juniors to the naive masses in return for cash payments from the companies he promotes, accuses a fellow paid pumper of being a naughty boy and of low moral stature.... simply delicious, you can't make this shit up.

But what's behind this huffing and puffing from Ameduri? Your author's best source explained all to his willing ears last night, here's the back story:

1) Ameduri was paid by Joe Grosso (who happens to be another sleazeball moose pasture peddler in Vancouver, but only a bit-part player this time) to pump Golden Arrow (GRG.v) to his flock of stupids.

2) Ameduri did so, but in the video he put together (which he's now removed from his website) he mentioned that Byron King of Agora is promoting the stock to his particular flock.

3) For the record, Byron King at Agora has a big following but he's no mining specialist. When it comes to these juniors he gets told what to pump by his superiors who do very nicely from the deals (such is the multi-layered ways of these morally bankrupt pieces of shit who are pretending to care about you and want you to become rich).

4) Ameduri's mouthbreather following buy into GRG all at once and the price pops (see chart below).

5) Agora HQ gets wind that Ameduri is using their name in his promotions, sees the GRG price shoot up and order Byron King to call Sell on GRG in order to 1) take a small profit but mainly 2) to screw Ameduri over. Here's what Byron King sent to his flock, heading like this...

...and including such things as...

"...by
quirk of timing, we...published
our newsletter just before a bow-wave of publicity about the Golden
Arrow-Silver Standard relationship. Now there’s media out there that
paints Golden
Arrow as some sort of uncashed lottery ticket. We’ve seen some crazy
buying patterns."

...and...

"...the whole thing seems to have crossed over from realistic value-creation into a chat-room frenzy"

...in order words, a thinly veiled attack on the scumball Ameduri, who used that very same "uncashed lottery ticket" image to get the greed glands working in the unspeakably stupid people who read him.

6) GRG drops from its Ameduri pump high of 83c very quickly indeed, making Ameduri and his "uncashed winning lottery ticket" bullshit look very stupid indeed.

7) Ameduri now looks stupid. Which isn't surprising really because he is a really stupid individual and, but as he's also a sociopath you can't tell him that and Daniel Ameduri is way to full of himself to be able to handle the truth. So instead of chalking on up to experience and letting the bigger scumbag house of Agora win a round against him, he decides to get revenge on Byron King and Agora by publishing that hit job on Pershing Gold that went out last night (see above).

8) He chose Pershing because a) Byron King is stupid enough to have this worthless piece of crap as his gold pennystock top pick and b) it is indeed run by a bigtime Vancouver crook with a "show horse" up front to make it look legit. In this case Pershing's real driver is the scum known as Barry Honig of Vancouver, who's been harvesting his riches from the naivete of Byron King (who claims to have visited the Pershing project and is daft enough to believe they're "serious mining people") and his even dumber followers.

Now that Ameduri has declared open warfare against Agora, it's going to be fun to watch as he loses his contracts with Amir at Brazil Resources (yet another BS pump vehicle) and is ostracized by the whole Vancouver BS show. That's the thing with Ameduri, he's so stupid he has no idea who he's messing with...yet.

Which brings up an interesting point about gold; we know the monetary metal is doing well this week, we know Dr. Copper is trading like grumpycat. So at what point does the asthenic demand for one stop the other from continuing its upmove?

So far the 2016 Copa America football (soccer if you must) tournament being held in the United States of America has enjoyed these wonderful moments, each one helping to reinforce the status of the US schools system as a paragon of education and mutual respect.

Discounted 10% to peers since the news hit. All the concerted pumping in the world can't stop the cold, hard cash from talking loud and clear.

Meanwhile, the most incisive mail received by your humble scribe on the issue today noted the wonderful way in which the Collective United Network of Toronto Saleforce (you know them as brokerage sellside anal ysts, no need to use acronyms) says nothing about LUG's use of a 5% discount "...when cost of capital for non investment grade issuers is 14-15%". Exactly right, kind reader.

Or maybe you think that having the name "Lundin" up there makes it automatically investment grade.

After doing the ConfCall, Ron Hochstein skipped over to BNN for a Q&A with Andrew Whatshisname and you can watch it here. The line he used up there in the title is a good soundbite, but it doesn't address the problem with FDN. When he does get to that point just after minute three, Hochstein says that the tax deal struck with the government of Ecuador is "fair". He tells us the "effective tax rate is 29%" over the life of mine, which is weird considering that according to Ecuador's constitution they need to leave 51% in-country. But hey, details.

Trivia: Ron Hochstein's gold tie reminded me of Tye Burt's similar taste in gold ties. Coincidentally, Tye Burt also had his thing with FDN while leading up Kinross. Anyone heard from Tye Burt recently?....anyone?

Yesterday
saw the largest one day copper delivery since 2004 at 21k mt, this
morning another 22kt, all into Asia. Metals that was attracted into
China in the early part of the year has not found a home and is now
coming back out. This also corroborates with multi-year lows in Chinese
Physical premiums.

...and the long-held IKN position regarding the complete bullshit he peddled about Diego Benavides while at Minera IRL has been ratified by an independent, internationally recognized third party auditor. This from the Minera IRL NR this morning:

The findings of the forensic investigations of whistle blower
accusations by Baker Tilly (Peru) delivered on May 24th disclosed there
was no credible evidence of wrong doing or criminal misconduct by Mr.
Diego Benavides or other members of the management team. Accordingly his
authority to manage the affairs of the Company in Peru has been fully
reinstated.

Hoodathunkit, eh? It's worth recalling that Daryl Hodges used exactly the same whistleblower smear campaign scheme to try and get rid of who he perceived to be his enemies when he was CEO at Jennings (before he was fired). And once he'd gone and those whistleblower accusations had been investigated, no wrongdoing was found either.

Daryl Hodges tried to ruin the reputation of Diego Benavides by spreading scurrilous lies about him, both in Peru and internationally. The truth is now out and the tables have been turned, it's Hodges' reputation that's now in tatters and no company worth its salt will ever employ this pathetic excuse for a human being ever again.

6/6/16

The Lundin Gold (LUG.to) NR on the Feasibility Study (FS) for Fruta Del Nortethis evening is a minor work of art. But not a major one, because there are obvious flaws and it must have strained their marketing department to the limit to come to an agreement with the "mining guys" for a way to get the post-tax IRR above 15%.

A 5% discount rate? For Ecuador? Are you kidding me?

The minor stuff such as using $20/oz silver to add a few tenths to the top line IRR

The U$750m capex that's presented as U$669m (it's a tax thing).

The 'royalties and production costs' at a smooth $75/oz...O RLY?

The oh-so-carefully worded paragraphs from Hochstein and Lundin.

But the main tell is this trifecta:

LUG claims an all-in sustaining cash cost (AISC) of U$623/oz.

LUG uses a U$1,250/oz gold price.

LUG offers a 15.7% IRR.

They are trying their very very hardest to tell me that making over $600/oz on 340,000 ounces of gold per year for thirteen years results in the project making less than 20% IRR. And they're telling me that's normal. Welcome to the reality of Ecuador and cue the IKN lovable pet parrot:

Primero Mining Corp. ("Primero" or the "Company") (TSX:P)(NYSE:PPP)
today announces that it has entered into an agreement with a syndicate
of underwriters, led by BMO Capital Markets, pursuant to which the
underwriters have agreed to buy on a bought deal basis, 19,150,000 units
of the Corporation ("Units") at a price of C$2.35 per Unit (the
"Offering"), representing aggregate gross proceeds to Primero of
C$45,002,500. Each Unit entitles the holder to acquire, for no
additional consideration, one common share ("Common Share") of Primero
and one-half of one common share purchase warrant (each whole common
share purchase warrant a "Warrant") of Primero.

Each full Warrant will entitle the holder thereof to purchase one
Common Share of the Corporation at a price of C$3.35 per Common Share,
for a period of 24 months following continues here

Waddya say, Tin Man?

As for the reason for the raise, we can run a mini Ottotrans on the part of tonight's Primero NR which explains that the net proceeds of the Issue will be used to...

"...advance development at the
Company's San Dimas and Black Fox mines as well as for exploration,
working capital and general corporate purposes."

He ordered his minions to charge into the low liquidity Lundin Gold (LUG.to) and got them to move the share price up to unsustainable levels, now he's going to have to explain to them just why he got them into a project with a pre-feas that sucks and try to get them out without hurting the PPS too much. 15.7% IRR at U$1,250/oz? A 5% discount rate for Ecuador?

Here are the three exit polls that were released at 4pm local time Peru as voting closed over the country:

IPSOS: PPK 50.4% Keiko 49.6%

GfK: PPK 51.2% Keiko 48.8%

CPI: PPK 48.9% Keiko 51.1%

Or in other words, two exit polls say PPK, one says Keiko and nobody is going to be stupid enough to concede defeat until all the votes are counted.

Tomorrow morning we'll have a decent idea as by then, around 80% of the official votes are expected logged. But there will be no victory parties tonight, that's for sure.

UPDATE: We now have the first Fast Count results through, which is normally a strong indication of the true final result (the system involves the polling company reps running from polling station to polling station and asking the results from the people manning the stations, who then read off their results).

They're now showing 50.9% PPK, versus 49.1% for Keiko.

It's not impossible for Keiko to reverse this position as it would involve a swing of less than 200,000 people and just the overseas votes would in theory be enough. But even though we can't be certain and there won't be a winner called tonight, it's looking good for PPK.

UPDATE 2: The final Fast Count result gives PPK 50.8%, Keiko 49.2%. It's not impossible to see this reversed, it's very unlikely. PPK supporters are in full voice and party time now, writing's on the wall.

Second Place: "The Angry Geologist does Pretium (PVG)", a post that TAG did after reading my snarky little number on the PVG news release of last week and the reader response I added at the end. It's worth mentioning that I'm not TAG and don't have the slightest amount of editorial control over what he writes (wouldn't want it anyway) because from the feedback received some of you think I'm out to get PVG or somesuch. No, wrong again trollsville, I'm out to open the eyes of people who are stupid enough to swallow whole the corporate spiel of mining companies and get them to question assumptions at all times. So you may or may not agree with TAG's assessment of PVG (no need to write in again, I've heard all angles), but I'd suggest that checking your own assessments of any and every company, PVG or whatever, is a darned fine idea and good for your financial health if you're one of these crazy people who invests in the mining sector.

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